This is evident from the successful
scuttling of a Hindustan Aeronautics Ltd (HAL) project for designing and building
a basic trainer aircraft named the Hindustan Turbo Trainer – 40 (HTT-40) for training
rookie pilots of the Indian Air Force (IAF). Instead of this aircraft, which
HAL could build, export, overhaul, upgrade and even modify into a light attack
aircraft, powerful lobbies have promoted a Swiss trainer --- the Pilatus PC-7
Mark II.

Business Standard has learnt, and the
IAF has confirmed, that the MoD has directed HAL to close the HTT-40 project.
Instead, HAL will build 106 PC-7 Mark II trainers in India.

In 2009, the ministry of defence (MoD)
had ruled that the IAF’s requirement of 181 trainers would be met through two
simultaneous channels --- 75 aircraft bought from abroad; while HAL designs and
builds 106 HTT-40 trainers in India.

Accordingly, the IAF contracted on
May 24, 2012 with Pilatus for seventy-five PC-7 Mark II trainers for Swiss Francs 557
million (Rs 3,600 crore). With that done, the IAF began a shrill campaign demanding
106 morePilatus in place of the HTT-40.

Business Standard has identified a four-pronged
campaign that promoted the Pilatus trainer, while blocking the HTT-40
programme. This included a letter from a serving IAF chief to the defence
minister that knowingly understated the cost of the Swiss trainer, to argue that
the indigenous trainer is too expensive; a letter from a Bharatiya Janata Party
(BJP) member of parliament (MP) to the Chief Vigilance Commissioner (CVC) alleging
corruption in selecting an engine for the HTT-40, delaying the engine purchase;
another letter from a shadowy non-governmental organisation (NGO) to the CVC, also
alleging irregularities in HAL’s engine selection and levelling charges against
HAL’s design chief; and repeated attempts by the IAF deputy chief, who sits on HAL’s
board, to choke off funding for the HTT-40.

CVC investigations have found no
wrongdoing, but the investigation has delayed HAL’s purchase of an engine for
the HTT-40. Such delays strengthen the IAF’s case for buying more Pilatus.

Business Standard has earlier reported
on the letter written by then IAF chief, Air Chief Marshal NAK Browne to then
defence minister, AK Antony (July 25, 2013, “Indian Air Force at war with Hindustan Aeronautics; wants to import,
not build, a trainer”, and July 31, 2013, “Admissions & obfuscations in IAF clarification on BS reports”).
Browne’s five-page letter argued for scuttling the HTT-40 and buying more
Pilatus, falsely stating that the Pilatus costs just Rs 30 crore per aircraft,
significantly cheaper than the HTT-40. In fact, due to the rupee’s decline, the
IAF was paying Pilatus almost Rs 40 crore for each PC-7 Mark II trainer being
delivered.

Browne also stated incorrectly that the
Pilatus’ cost would remain Rs 30 crore per aircraft till 2017. In fact, the
next 38 trainers will cost Swiss Francs 6.09 million (Rs 39.3 crore today) each
under the “options clause” of the contract. The cost of the following 68
aircraft (adding up to 106 additional PC-7 Mark II) would be negotiated afresh
and would almost certainly be higher, due to inflation.

The MoD ignored Browne’s letter, being
disinclined then to scupper an indigenous project. However, with the IAF
blocking funding for the HTT-40, HAL was forced to commit Rs 180 crore of
company funds in July 2013. In early 2014, that was upped to Rs 350 crore, with
three prototypes to be built for accelerated flight-testing.

With the HTT-40 on track, and racing
towards its first flight next year, two corruption allegations mysteriously popped
up, stalling the project. Both alleged wrongdoing in HAL’s selection of the Honeywell
TPE 331-12B engine after an open tender, when the alternative supplier, Pratt
& Whitney, refused to allow licensed manufacture in India. With the first
flight looming, Honeywell agreed to provide a “Category B” engine --- a used
engine with more than 80 per cent of its service life remaining.

The first complaint came in early
November from the BJP MP from Jaunpur, Krishna
Pratap Singh, who complained to the CVC aboutthe
engine selection and blamed HAL’s design chief, T Suvarna Raju, who oversees
the HTT-40 project. Investigation began and the MoD halted engine procurement.

Contacted by
Business Standard, Krishna Pratap Singh claimed that he knew nothing about the
HTT-40 or the issues involved. “About 3-4 months ago a “sajjan” (person of good
character), who I don’t remember now, came to me and said there was corruption.
I only wrote that the matter be investigated, and any wrongdoing corrected,”
said Singh.

The second allegation came almost
simultaneously from an NGO called Rashtriya Mukti Morcha. The RMM has neither expertise
nor previous interest in aerospace. It has earlier filed petitions against
Sonia Gandhi’s right to hold constitutional office, and in the Jharkhand Mukti
Morcha bribery case.

Contacted by Business Standard, RMM
chief Ravindra Kumar acknowledges filing a complaint. He said that details are
in his files, but he repeatedly denied requests to visit his office to ascertain
the basis for his complaint.

CVC investigations into the complaints unearthed
no wrongdoing; It is not unusual for “Category B” engines to be chosen for
prototypes, while buying new engines for the production aircraft. HAL had
powered the Intermediate Jet Trainer prototype with a “Category B” Larzac
engine, until new engines became available.

Even so, engine procurement was halted.
Meanwhile the IAF repeatedly petitioned the MoD that Swiss trainers should be
quickly bought since the HTT-40 would be late.

All this while,
the Deputy Chief of Air Staff (DCAS), who sits on HAL’s board, steadfastly opposed
funding for the HTT-40. When the board allocated Rs 180 crore in July 2013, the
DCAS dissented in writing, something that the IAF now denies.

The IAF has
sought to associate the PC-7 Mark II with the “Make in India” drive by seeking
to build it in India to blueprints provided by Pilatus. Yet it would
essentially remain a foreign aircraft, with intellectual property, technology
and licensing residing abroad. In contrast, a “Make” category project like the
HTT-40 would involve far more expansive indigenisation ---
including ground-up design and integration, test flying and certification and
eventual manufacture.

In 2013, the IAF
asked HAL to scrap the HTT-40 and instead build 106 PC-7 Mk II from technology
transferred by Pilatus. “However, in their own interest HAL declined to
participate in license manufacture of the PC-7 Mk II”, the IAF told Business
Standard.

Rebuffed by HAL,
but insistent on providing a veneer of indigenization, Browne bizarrely declared
on October 8, 2013, that the IAF’s base repair depots (BRDs) --- which maintain
and overhaul aircraft and engines --- could build the PC-7 Mark II. The IAF’s
maintenance chief, Air Marshal P Kanakaraj, quickly contradicted him, while the
MoD simply ignored the proposal.

Now, however, battered
to a halt by groundless complaints and unable to buy an engine, HAL has buckled
under the pressure. Last month HAL chairman, RK Tyagi, agreed to build the PC-7
Mark II, while developing the HTT-40 as an HAL project.

Even that is
seen as a threat. At HAL’s board meeting on December 20, PK Kataria, an MoD
financial advisor questioned why the HTT-40 project should continue, since HAL
would be building the PC-7 Mark II.

Defence Minister
Manohar Parriker will pronounce final sentence on the HTT-40, in the apex
Defence Acquisition Council. Asked when this would happen, he indicated that
the die was not yet cast: “There are issues [relating to the Pilatus] that were
raised and which have to be addressed. I think every query and every difficulty
has to be properly addressed.”

The MoD and HAL
did not respond to requests for comments for this report.

34 comments:

Kris
said...

Wow..Colonel,

This is a fabulous example of "investigative journalism". Many congratulations.

NO Pilatus PC-7MKII would mean loss of Swiss tourism and paid holiday for India's Imported Air Force personnel. It would also affect free scholarship for their children and post-retirement benefits. So Imported Air Force's desperation for Swiss, French and western products is understandable.

New RM or no RM, there are some universal truths in defence procurement. There is no free lunch and one has to pay to get his product accepted. Irony is that its the bribe giver who is punished in India but not the bribe taker.

ISnt this how the previous BTA by HAL was scuttled...tie them in red tape and kill the project...When HAL has decided to put its money why should IAF bother...this is so much biased action...Also the leader of HAL who has been supporting the project how come he made a U turn and accepted..what was the pressure on him.....Sad another desi effort falls prey to politics...

Whats the great surprise..HAL agreed to Pilatus...from one aero show to other a complete change...

As i am told, the aircraft has taken shape and is awaiting engine..so what do they do now...place it in museum with a IAF insignia on it...asking who killed me??

How come the MOD is playing toy to IAF games...So much to MR Modis Make in INdia campaign...HAL is a national property it cant be allowed to decide fate of aerospace in this country and do garage job....India needs to continue the HTT

OK one question if pilatus has a fleet avail of 90% and if each pilatus is flying 6 hours per day , for 300 days, it means teh IAF has 75x6x300=1,35000 flying hours..and if each pilot needs 60 flying hours... we are looking at a capacity to train 2000 plus pilots every year...so why does teh IAF want more pilatus..Let HAL make the HTT and produce it in next 5 years....till such time pilatus will suffice...whats the rush...Can the IAF explain why it wants 8000 crores to be paid to Pilatus....bailing out swiss firm?Also how can the repeat PO be greater than original qty of the DAC decision..wont Koreans and Americans object...

Finally HAL could not finalise the Main ToT contract till date so how in world will pilatus conclude the mfg contract in a three years...

HTT should go ahead..stop killing the Made in India designs....stop being anti nationals...

Whatever the intricate details of the case, one thing is clear that HAL needs to stand on its own feet as an independent business entity and take actions accordingly. The MP must be put under the scanner to ascertain the truth and if he has cried 'wolf' to sabotage the project he must be given exemplary punishment.

Werent you with the RM a few days before...why didnt you ask him what is he gonna do now...bite the bullet and decide to go with true MAKE in INDIA or will let it be swayed the air force way..Best part how is MOD now singing tunes with IAF and agreeing....A fight fought for three years cant be called off this way...HAL needs to stand on its feet and prove....we cant allow this to Happen....If HAL fails its heads should be rolled...and if delivers... we have an ISRO example to follow...

IS it that Tyaggi sahab has made deal before he leaves and will be banking a plum post like a member on planning comm or some govt advisor to MOD....why this decision in his last month....some thing is not right....He was the one who took one on one with Browne and now he is meeking backing out in his retirement month...and shame on BJP MPs who are taking money and throwing letters all around...The Pilatus lobby is clearly at work and has paid all guys...

there are no orders with them and they want this desperately..what the hell are the Koreans doing...they were cheated by swiss and IAF together... they should complain and demand a fair treatment and is HAL HTT wins well the country saves its pride by not importing a 70's aircraft

If someone gets a bribe in defence, that case should be completed within 3 months and the punishment should be immediate hanging for every Indian involved in that bribe, it doesn't matter how small or how big the bribe including the MP's writing fake letters to purposefully screw the desi effort. Then see how much faster everything changes.

Colonel Shukla, do you think HAL is competent enough to design, develop, test,certify and delivery within laid time frame? Remember the examples of HAL TEJAS, even after nearly three dacades, it is nowhere near FOC or example of HJT-36,after nearly two decades it has basic design flaws and the project ultimately shut down.

Lack of vision and attraction for election fund is obstructing the government from taking obvious decisions. Government must ask for increase in manufacturing capacities of all successful products such as Aakash Missiles, Helina / Nag Missiles, various naval vessels, ALH Dhruv / Rudra etc. Defence PSUs must increase the indigenous content of all these successful products and at the same time aim for the next model of these products. The nation needs to know the status of next model (Mark V) of ALH Dhruv. It is immoral to allow Agents to market foreign products in India. No efforts can be seen to be taken by the government for exporting Indian Defence products.I also request the government to increase the production of the LCA for user trial.

A real tragedy indeed. Vested interests are holding back true indigenous capability. It is hard to believe that men in uniform - who never tire of playing perpetual victims, harping on their intellectual superiority vis-a-vis the IAS and making claims of being the only class possessing strategic vision - actually had a hand in killing a fledgling homegrown project. Whatever the faults of AK Antony, he at least held the hand of HAL in a genuine Indian project with long term benefits and implications. This BJP administration is slowly changing colours and showing suspect intents - Whether it be the BTC turnaround or promises of OROP. This illiterate BJP MP from Jaunpur and rabble rousing NGO need to be investigated. Will it happen? Highly unlikely considering who their probable instigators are. Will the opposition raise the issue? Again unlikely as they are preoccupied with derailing good and long overdue reforms which they could never push through. Would have made a good comedy only if it hadn't been so bloody tragic.

I am so glad that HAL is being asked to work on Pilatus instead of reinventing the wheel. Taking away excuses from HAL in not delivering IJT is always welcome. I hope and pray the current government will tighten the screws on HAL further.

HAL should be barred from taking up any new design and development projects and asked to concentrate on IJT, LCA and AMCA. If HAL claims they still have design resource available, then ask them to work on NAL Saras and get it to fly.

Logically speaking this makes the best sense. Why do you want to lumber IAF with two versions of the basic trainer aircraft? You end paying extra every single day for the next 30+ years to maintain two types. HAL were always playing catch-up. They should have done this before IAF bought the first batch. To me this points to a gap in communication and understanding the needs of the IAF.

There should be action taken against those persons or organisation who accuse falsely to stall critical defence projects. Also as a rule, till no adverse judgement is pronounced, critical defence projects should continue unabated.

HTT-40 will required engines to be imported. LCA Tejas will not fly without imported GE engines. When engines are so critical to the performance of any aircraft, shouldn't HAL focus on delivering the Kaveri engine instead of designing new aircraft? It seems HAL is hell bent on not learning from the HF-2 Marut fiasco!

The proof of the pudding lies in the eating and waiting for the htt-40.....well the less said the better. HAL is so incompetent the last project (HJT-36) they tried is functionally inferior to the Messerschmitt 262 and the germans managed to make that while having a few logistical issues. Maybe a good starting point would be something like a Cessna or a bonanza.

1. LCA - 30 years in development - Final operational clearance not in sight.

2. IJT nowhere in sight after 15 years of development. Now HAL is saying they made a mistake with the tail design and it will take how many years (5-10 years to fix this simple problem)

3. NAL Saras - a very simple plane in development for 20 years. Wrong design, overweight, not fit for service after several years of wait.

4. HPT-32 - Basic trainer created by HAL had the worst crash rate of any trainer in the world.

With such a poor track record of HAL, how can the IAF be blamed for trying to get a good aircraft for basic training. Calling it an Import Air Force by personnel of Public sector undertakings is hilarious. Come up with a working product first and then speak.

HAL cannot and should not design a new aircraft at this time. They have not delivered a single homegrown design in last 10 years. IJT is a disaster self created by HAL. What makes you trust the ability of HAL so blindly?

Whilst I admire your push for HAL aircraft, fact is that HAL has been slow and incompetent to produce fly worthy aircrafts. Isn't it a fact that infrastructure which HAL has build over the years on taxpayers money is far better than what Boeings have in USA, however the result is zero...Let us face reality, IAF cant keep waiting for its pilots to be killed due faulty trainer aircrafts.. Kudos to HAL to finally realise their inefficiency and incompetence

HAL has been producing a lot of shoddy products and this is because, we India as a country never really had any expertise in producing a Fighter Jet, Transport Plane or even a trainer.

The IAF neglecting the trainer is understandable but why in the name of basic understanding do they have to neglect the Tejas. Colonel Shukla this takes us back to one of your previous articles on "A Bird in Hand" with Dassault Rafale coming with a $30 Billion price tag, would it not be better if we order 100 mk1 and 100 mk2. This purchase would lay the foundation for an Aerospace Industry which this country needs. To top it with 75 additional Sukhoi 30 mki.

The IJT Sitara is no where close to induction. I think HAL has enough on its plate and the IAF would not want to wait for another 10 years to get a basic trainer.

HAL has to complete LUH, LAH , LCA. mk1 & MK2, IJT and LTA. All going for 10-30 years. Greed has its limits. Let them first do root cause analysis got HPT 32, then work on This. With PIlatus IAF has something flying,

DM Parrikar must order a thorough evaluation of minimum BAT requirements of IAF for present and near time...He must only order the minimum required numbers so the training program will not suffer needlessly...

And then, he must provide resources to HAL to continue with the building/completion of BAT with Honeywell engine...

Honewywell engine is in manufacturing since 60 years in various versions and is installed on various versions of aircraft...So their engines will be good for BAT and IJT too...So HAL may wish to look for a powerful engine to overcome IJT weight issues...

DM Parrikar must bang his hands on table and stomp his feet and tell both HAL and IAF to work together to create a BAT within 2 years or so...

Whatever the decision, India definitely needs to develop its own aerospace technology, trainers, fighters, helicopters, UAVs, etc...No one will give them for free and India can't afford to import forever...

NO Pilatus PC-7MKII would mean loss of Swiss tourism and paid holiday for India's Imported Air Force personnel. It would also affect free scholarship for their children and post-retirement benefits. So Imported Air Force's desperation for Swiss, French and western products is understandable.

7 January 2015 at 11:10------------------------------

Kris, I don't know what you are smoking, but it seems to be the interesting kind. I have never seen Indian students go to switzerland for studies let alone on a scholarship.

The Imported Air Force (IAF) must be repeatedly named and shamed like this. This will undo the damage made by the barrage of negative articles about DRDO in mainstream dailies like ToI, Indian Express, etc.

Also, the general public must also be made aware of the technicalities involved, so that they too objectively analyse the procurement decisions made by the army and IAF.

They too should be made aware that the officers of the army and IAF are NOT Gods, whose words should be taken as gospel.

Don't feel too bad Kris because if the black money from India and other countries was to be pulled out of Swiss bank you would be hunting for your post retirement benefits. Ooh yes then you would need Indians to come and visit your country. If only Kashmir was a safer place you would be denied that privilege too.